Shale gas, integration driving Ascend’s nylon strategy

By: Robert Grace

May 27, 2013

GUANGZHOU, CHINA – As part of a strategy to secure its position as the world’s only fully integrated maker of nylon 6/6 resins, Houston-based Ascend Performance Materials Inc. plans to start up a new, 30,000-metric-ton compounding extrusion line by June 1 at its Pensacola, Fla.

The new line, which is running trials now, will complement Ascend’s existing U.S. compounding in Foley, Ala., and its five U.S. nylon resin plants, according to President J. Timothy Strehl. The firm also has compounding partners in Europe and China.

Company officials revealed the development at Chinaplas 2013 in Guangzhou, where they also noted the firm is in the midst of launching 10 new products targeting the automotive, electronics and cable-tie sectors.

Ascend – a former Solutia Inc. unit before being bought in 2009 by private investment firm SK Capital Partners – touts its “unique, cost-advantaged position” of being the only nylon 6/6 producer that uses the propane hydrogenation (PDH) method, known as C3-based technology, for making the key intermediate adiponitrile, or ADN. Using this process rather than the more widely used C4 butadiene-based method will allow Ascend to benefit from North America’s current shale gas revolution, Strehl said.

He noted that shale gas is a source of propane that drives on-purpose production of propylene (C3) using the PDH technology. North America has three of the four major global plants of ADN (the other being in France), while the currently tight butadiene (C4) supply does not directly benefit from shale gas, according to Strehl. Propylene from PDH units is expected to contribute an estimated 20 percent of North American supply by 2016.

Ascend also is the world’s largest producer of adipic acid and the third-largest maker of acrylonitrile, 80 percent of which it consumes internally. The company splits it business roughly into thirds, between plastics, chemicals and polymers/fibers.

The steady supply of low-cost feedstock means “it’s cheaper for us to deliver nylon 6/6 from Pensacola to China than from Pensacola to Michigan,” given the cost advantage of shipping by sea rather than by land, said Scott Rook, vice president of plastics. The former Eastman Chemical Co. executive, who joined Ascend in April 2010, also oversees the fast-growing Asia Pacific region for Ascend. Asia – driven by China – is the largest region both for the plastics business and for Ascend overall, he noted.

They anticipate strong continued growth in the region. The automotive sector is by far the largest consumer of nylon 6/6, with 10 kilograms of the material, on average, in every vehicle. China is projected to produce 20 million cars this year, Rook said, and possibly 30 million annually (or double that of the U.S.) within five to 10 years. The material also is used in tire cord and air bags, and the number of air bags per car in Chinese vehicles is expected to grow sharply in the coming years.

But still, it’s shale gas that is the key. “We want to manufacture in the low-cost region,” Rook said, and shale gas means that region is North America. Ascend recently announced plans to build a massive, $1.2 billion plant in Alvin, Texas, to make the feedstock propylene using the PDH method. Strehl was reluctant at this early stage to discuss details of the Alvin plant in an interview at Chinaplas. He offered no further information on potential production capacity but stressed that Ascend is “serious about the project.” He said the timing of the late-February announcement was driven by the $1 million in funding assistance the company is receiving from the state-run Texas Enterprise Fund.

Asked about the impact of last year’s disastrous nylon 12 production outage prompted by a fatal fire and explosion at Evonik Industries AG’s cyclododecatriene factory in Marl, Germany, Rook said it has helped to alter the commercial landscape. Tradition-minded automakers and suppliers globally – stung by the abrupt disruption of supply of such a key material – “are looking at the propylene-based option now. It’s creating some opportunities,” he said.

Ascend also has announced several new Vydyne-brand nylon 6/6 products targeting the automotive industry:

Vydyne R860 is glass- and mineral-filled and based on post-consumer recycled feedstock.

Likely applications include radiator end tanks, charge air coolers (intercoolers), fans and shrouds, and under-the-hood connectors. Several more new grades are due to launch later this year.

At Chinaplas, Ascend also announced it will introduce a pair of new product ranges in the second half of 2013 targeting the electrical and electronics markets.

One is a range of ultraclean, glass-reinforced, Vydyne R-series grades. These materials, with significantly reduced plate-out properties, are designed to benefit customers with long, continuous-injection-molding, part-production runs or who injection mold very complex parts.

The other is a range of non-halogen, flame-retardant Vydyne ECO-series grades. These are targeted at customers who manufacture terminal blocks, connectors and low-voltage switchgear products.

Finally, the firm also is introducing a new class of impact- and weather-resistant Vydyne grades specifically designed for cable-tie manufacturers who service the transportation, heavy equipment or industrial markets.